HARRISBURG – Gov. Tom Corbett’s promise to make the Pennsylvania tax appeals process more objective and taxpayer-friendly, led to the Council on State Taxation (COST) this week namingPennsylvania as the “most improved” state in the nation — vaulting from a “D” rating to an “A-” in its most recent tax administration scorecard.
“This acknowledgment underscores the importance of tax appeals reform and highlights the victory we accomplished for Pennsylvania taxpayers,” said Corbett. “We have made significant changes over the last few years that make the appeals process more fair, more transparent and more accountable to the taxpayers of Pennsylvania.”
Key changes impacting Pennsylvania’s improved COST ranking include restructuring the Board of Finance and Revenue within the Treasury department to better address tax appeals functions independently and impartially, and 2012 legislative changes designed to reduce issues that result in tax appeals and make the appeals process more fair and less cumbersome for taxpayers.
Peter Calcara, Vice President of Government Relations for the Pennsylvania Institute of Certified Public Accountants, called Act 52 of 2013, which restructured the Board of Finance and Revenue, “the most significant reforms in Pennsylvania’s tax administration process in more than 20 years.” When the reform takes effect in April, it will replace the current six part-time members of the board with three full-time, independent tax professionals.
Since Corbett took office, the Department of Revenue has worked with the Pennsylvania Chamber of Business and Industry and the Pennsylvania Institute of Certified Public Accountants to draft and win support for legislative solutions improving the tax appeals process.
“Governor Corbett came into office determined to improve government and taxpayer services, and we at the Department of Revenue focused our resources to deliver on the Governor’s commitment,” said Revenue Secretary Dan Meuser. “The significant improvement in our ranking is a result of the hard work and dedication of the people of the Pennsylvania Department of Revenue.”
Prior to achieving legislative reform, beginning in 2011, the Department of Revenue implemented a number of administrative improvements to the tax appeals process that streamlined operations and improved taxpayer service. Most notably, the Department began considering requests for compromise in cases where the compromise illustrates doubt regarding liability and/or it promotes effective tax administration. This change allows taxpayers an opportunity to resolve tax appeals in a matter of weeks, rather than endure a potentially costly process that could last years.
In addition, the department waived for taxpayers with good credit the requirement to file a costly appeal bond before an assessment can be challenged, eliminating a potential “pay-to-play” obstacle to achieving a fair result.
“I thank Secretary Meuser and others at the Department of Revenue for their leadership on this issue,” said COST president and executive director Douglas L. Lindholm. “The scorecard evaluates the state’s statutory framework, and we realize that legislative change of this magnitude requires a great deal of effort and commitment on behalf of taxpayers and tax administrators alike.”
About COST: The Council on State Taxation is the premier state tax organization representing taxpayers. COST is a nonprofit trade association consisting of over 600 multi-state corporations engaged in interstate and international business. COST’s objective is to preserve and promote equitable and nondiscriminatory state and local taxation of multi-jurisdictional business entities.